India is world-renowned for exquisitely designed fashion accessories that are available in a variety of modern and traditional styles. Most models feature a distinct flavor that is unique to the country.

The industry constitutes roughly 6,000 enterprises that offer jewelry, fashion bags, wallets, head and neckwear, and belts. Companies benefit from a plentiful supply of raw materials that are sourced from numerous cities and states nationwide. This key advantage has propelled India to become a leading manufacturing hub for different types of fashion accessories.

The wide array of materials include different types of beads, semiprecious stones and metal for jewelry, leather, canvas and jute for bags and wallets, and cotton, silk, wool and linen for neckwear.

The industry is highly export oriented, with more than 80 percent of output being sent to foreign markets. Jewelry prevails as the most important product line, accounting for almost 60 percent of total exports. Bags and wallets capture almost a quarter of overseas shipments.

There are currently a number of challenges confronting the industry. The most crucial of these is the volatile rupee-dollar exchange rate, which has had erratic fluctuations since the start of 2008.

As a result, makers have been posting quotes with a shorter validity period. They also prefer to accept payment in euros since this currency has seen relative stability over the same period.

The following are some of the key trends we see in India’s fashion accessories industry:

• Suppliers have a rosy outlook for the year ahead as long-time buyers from traditional markets and new customers from emerging export destinations are expected to reinvigorate demand. With this on the horizon, the overwhelming majority of makers anticipate exports to increase significantly. In fact, close to half of suppliers profiled in this report see revenue surging by at least 20 percent.

• About half of interviewed makers indicated they will maintain prices over the next six months in an effort to keep old customers and draw new ones.

• Manufacturers will continue to emphasize the US and the EU. An increasing number of companies, however, are expected to shift focus to new markets in South and Central America.

• Suppliers are divided on product design trends. One-third of featured makers will highlight basic colors and simple designs, while an equal number will concentrate on vibrant colors and styles.